ISPs to Pay for Digital Economy Bill's Administration Cost

Sep 14 2010

In a move to further stifle the UK digital economy, the Department for Business, Innovation, and Skills (BIS) announced today that ISPs will be required to pay for 25% of the cost of tracking down illegal file sharers on their services.

The Digital Economy Bill was passed last April in a last minute, poorly attended parliamentary session prior to the elections. One of the many regulations that came into force following the bill’s passage was the requirement that all internet service providers (ISPs) in the UK monitor and report any and all illegal file sharers on their services. The Internet Service Providers Association (IPSA), speaking on behalf of the ISPs, called this the worst kind of government intervention and meddling with private companies and private industry. Even the CEO from TalkTalk publically announced that the company would not comply with the Digital Economy Bill’s regulation.

Under a proposed code of conduct outlined earlier this year, however, rights holders will send ISPs the IP computer addresses of those people caught illegally downloading. Then those ISPs will send warning letters to the registered owners of those computer addresses. The rights holders then can demand the contact information of those infringers in order to prosecute them for illegal use of their material. The proposed code of conduct suggests that after three warning letters in one year, the copyright infringer can be put on the list of users that can be requested by rights holders. It is the cost of this process and the following legal administration that will be incurred by ISPs at 25% of the total cost. Rights holders will pay for 75% of that cost, but IPSA and the ISPs that they represent believe that the full burden should be carried by the rights holders because it is in their best interests.

Nicholas Lansman, ISPA Secretary General said, "The Internet Service Providers Association has consistently argued for the 'beneficiary pays' principle and is disappointed with today's announcement. Full cost recovery for serious law enforcement cases is an established rule and ISPA sees no reason why it should not be the case here.” IPSA went on to say that this decision is, “...contrary to the promotion of the digital economy.”

A key goal of the Coalition Government is to promote the digital economy and the digital industry. If this is really the case, the sitting government should not allow for this undue burden on ISPs. It will only stifle innovation and, in the long run, prevent the growth of jobs and of this industry in the UK.In a move to further stifle the UK digital economy, the Department for Business, Innovation, and Skills (BIS) announced today that ISPs will be required to pay for 25% of the cost of tracking down illegal file sharers on their services.

The Digital Economy Bill was passed last April in a last minute, poorly attended parliamentary session prior to the elections. One of the many regulations that came into force following the bill’s passage was the requirement that all internet service providers (ISPs) in the UK monitor and report any and all illegal file sharers on their services. The Internet Service Providers Association (IPSA), speaking on behalf of the ISPs, called this the worst kind of government intervention and meddling with private companies and private industry. Even the CEO from TalkTalk publically announced that the company would not comply with the Digital Economy Bill’s regulation.

Under a proposed code of conduct outlined earlier this year, however, rights holders will send ISPs the IP computer addresses of those people caught illegally downloading. Then those ISPs will send warning letters to the registered owners of those computer addresses. The rights holders then can demand the contact information of those infringers in order to prosecute them for illegal use of their material. The proposed code of conduct suggests that after three warning letters in one year, the copyright infringer can be put on the list of users that can be requested by rights holders. It is the cost of this process and the following legal administration that will be incurred by ISPs at 25% of the total cost. Rights holders will pay for 75% of that cost, but IPSA and the ISPs that they represent believe that the full burden should be carried by the rights holders because it is in their best interests.

Nicholas Lansman, ISPA Secretary General said, "The Internet Service Providers Association has consistently argued for the 'beneficiary pays' principle and is disappointed with today's announcement. Full cost recovery for serious law enforcement cases is an established rule and ISPA sees no reason why it should not be the case here.” IPSA went on to say that this decision is, “...contrary to the promotion of the digital economy.”

A key goal of the Coalition Government is to promote the digital economy and the digital industry. If this is really the case, the sitting government should not allow for this undue burden on ISPs. It will only stifle innovation and, in the long run, prevent the growth of jobs and of this industry in the UK.